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Weekly outlook for Crude oil, Natural gas and Gold 31 Jan-4 Feb

January 30, 2011

Here is a weekly outlook for the week of January 31st to February 4th showing the news items and reports that will be published this coming week mainly related to the US, Canada and EURO economies.

In addition, to the reports that will be published this week, it seems that the main news that will affect major commodities prices is the status in the Middle East, in particular, the attempts of a coup against current Egypt president Mubarak (see here for further elaborations).

This forecast shows how prices of major commodities such as crude oil price could be affected from the following reports (all times GMT):

Monday 31st of January 10.00AM – Euro area inflation estimate: The latest report regarding the inflation rate in the Euro zone during December recorded an annual rate of 2.2%. The low interest rate of the ECB of 1% will eventually cause further inflation pressures. This report will probably coincide with the upcoming press conference of the ECB (see below) later on this week (see here previous report);

Monday 31st of January 13.30PM – Canada GDP: This monthly report will present the changes in Canada’s GDP during November 2010. In the previous report pertaining October 2010, the GDP rose by 0.2% in which extracting gas as and mining oil were the main reasons for the growth. There are expectations for a similar increase in this forthcoming report. Since Canada is among the largest non-OPEC exporter of crude oil and also of natural gas, mainly to the US; as such, Canada’s economic condition might affect energy prices such as crude oil price and natural gas spot price. (see here previous report);

Wednesday 2nd of February 15.30PM – EIA report about Crude oil inventories: The EIA (Energy Information Administration) will issue its weekly report on the main changes in demand (consumption and storage) and supply (production and imports) for crude oil in the U.S. and how these changes might affect crude oil price. Last week’s report showed a rise of 0.1% in petroleumstocks, an increase of nearly 2.3 million barrels of crude oil. Last week, the refineries input and US production have declined, while imports of crude oil (mainly from Canada) have increased, compare to previous week. This rise in stocks is probably relate to the incline in imports despite the rise in energy demand due to the cold weather (see here my previous review on crude oil stocks);

Thursday 3rd of February 13.30PM – Department of Labor report – US unemployment claims: This weekly report showed a rise last week in unemployment claims despite the encouraging figures a week earlier – goes to show that this report is fluctuates highly on a week to week basis. For the week ending on Jan 22nd, the report showed an increase in initial claims of 51,000, settling on 454,000 claims; the insured unemployment rate rose to 3.2% rate for the week ending on Jan 15tha 0.1% points increase; furthermore, the number of insured unemployment for the week of Jan 15th was 3.975 million, a decrease of 39,750 compare to the previous week;

Thursday 3rd of February 15.30PM – EIA report about Natural gas storage: The EIA will also issue its weekly report on the main changes in natural gas storage and consumption in the US. The EIA report showed a rise in domestic consumption and prices compare to the previous week, as the underground natural as storage decreased by 6.4% compare to the previous week, reaching 2,542 (Billion Cubic Feet) for all lower 48 states (see here my previous review on last week’s figures update);

Thursday 3rd of February 15.30PM – ECB Press Conference: The European interest rate remained unchanged for a long time now on 1% (since May 2009). This low rate is the Central’s bank attempts to encourage economic growth, while the downside of this maneuver is that it could drive inflation up as a result;

Thursday 3rd of February 18.00PM – Federal Reserve chairman Ben Bernanke: The Fed chairman will address in his upcoming news conference (his first in two years) on the Fed’s monetary policy including the progress of QE2 (quantitative easing), i.e. the 600 billion USD stimulus plan which the Fed first announced back in November 2010. The expectations are that eventually this QE2 plan will drive prices up for major commodities including gold and crude oil price, which will consequentially raise inflation rate in the US, and devalue the US currency. These expectations, however, have yet to take place;

Friday 4th of February 12.00PM – Canada unemployment rate report: Last month’s report showed an increase in employment by 22 thousand and unemployment remained unchanged on 7.6%. This is a 2.2% rise in employment compare to December 2009 and coincide with expectations for an ongoing rise in employment in Canada (see here previous report);

Friday 4th of February 13.30PM – US unemployment rate report: This monthly report shows the changes in employment in the US during January 2011. The last report recorded an improvement as the unemployment rate fell by 0.4 percent point during December, from 9.8% to 9.4%. The number of unemployed has dropped by 556 thousand people to 14.5 million. Expectations are that there will be small to no change in this passing month’s unemployment rate. (see my last review on the US employment report);